31.2.1 Defining Transfer Pricing Methodologies

The assignment of Transfer Pricing Methodologies is part of the Create or Edit Transfer Pricing Rules process where assumptions about Transfer Pricing Methodologies are made for product-currency combinations. When you click Save in the Create Transfer Pricing Rules Process, the rule is saved and the Transfer Pricing Rule Summary Page is displayed. However, the Transfer Pricing Methodology has not yet been defined for any of your products at this point. You start defining your methodologies for the product-currency combinations before clicking Save.

The Transfer Pricing Rule supports the definition of Assumptions for combinations of two dimensions: Product and Currency.

You can define Transfer Pricing Methodologies for your entire product portfolio one currency at a time. For example, your portfolio is comprised of products denominated in two currencies (US Dollar and Japanese Yen) and that you want to specify different Transfer Pricing Assumptions and/or different Transfer Pricing Yield Curves, for each product group. Using the Currency selection drop-down list, you can first define Assumptions for the products denominated in US Dollars and then proceed with defining Assumptions for the Yen-based products.

After you have created a Transfer Pricing Rule, you can assign Transfer Pricing Methodologies to product-currency combinations in either of the following two ways:

• By creating a conditional assumption using conditional logic. For more information, see Associating Conditional Assumptions with Assumption Rules.
• Directly on the Transfer Pricing Methodology Page, as described here.